Blog Posts | Pembina Institute

2010 Federal Budget: Canada hits rock bottom on investments in environment

Blog - March 4, 2010 - By Tim Weis

We must be close to a turning point in investing in the environment, because the budget tabled today couldn't do much less.

A token $25 million for the next four years allocated to renewable energy in the forestry sector shows that this government sees renewable energy technologies as "boutique" experiments, not the mainstream solutions that they are in other parts of the world — and, more importantly, what they need to be in Canada.

If the government is going to live up to its election promise of generating 90 per cent of its electricity from sources that don't produce greenhouse gas pollution by 2020, we will need a ten-fold increase in renewable power in the next 10 years. Currently, 77 per cent of our electricity comes from "non-emitting sources" (defined by the government as large hydro, nuclear, carbon capture and storage and renewables) — but to close that gap on a national scale will require a serious ramp-up of investment in renewable power. New nuclear or carbon capture and storage cannot be rolled out in a meaningful way in only 10 years, in spite of the $1.5 billion allocated to them in the last two years.

Chinese workersIn China, 1.12 million people work in the renewable energy industry, and more than 100,000 new jobs are added to this sector every year, according to the government-backed Chinese Renewable Energy Industries Association.

Yesterday's Speech from the Throne committed Canada to becoming a "leader in green job creation", but today's budget does not walk the talk. With the Federal renewable energy investment program officially out of money, this budget's void effectively means the federal government is walking away from renewable power. Despite studies that have shown investments in renewable power actually generate a net financial gain for the government through increased tax revenues, it appears that the government still believes that taking action to protect the environment is at odds with building a strong economy. (In fact, Pembina's analysis shows that we can take strong action to address climate change while growing our economy and creating nearly two million net new jobs.)

Perhaps that perception is in part why Canada ranked 14th out of 17 countries for innovation, according to a recent report card from the Conference Board of Canada. Without strong federal leadership, Canadians will continue to lag behind as other countries take the lead in the emerging clean-energy market. (The U.S., for instance, set aside $98 billion for environmental and sustainable energy projects in last year's economic stimulus package, outspending Canada 14:1.)

While there was a notable ($80 million) investment to top up Canada's home energy efficiency program for one more year, the suite of ecoEnergy programs that help Canadian homeowners, businesses and industries invest in renewable energy solutions will come to an abrupt end by the end of the next fiscal year. This budget suggests it will review some efficiency programs, but there is an inevitable gap between when these programs will run out of money and when some, if any, will be renewed or revamped.

Cover of federal report: From Impacts to Adaptation The federal government's 2007 assessment found that "climate change impacts are already visible in every region across Canada," and those impacts will have "significant implications for communities, industry, infrastructure and ecosystems" - yet the government still has not put forth a plan to prevent the worst of those impacts. On top of doing little for renewable energy or energy efficiency at home, this federal budget also does not live up to this government's commitment under the Copenhagen Accord to provide money to help developing countries tackle climate change and adapt to its impacts. Canada's fair share of the short-term financing agreed to in the Copenhagen Accord would amount to over $300 million dollars a year for the next three years. Instead, today's budget provided nothing.

One opportunity that presents itself to not only reduce environmental damage, but also reduce our deficit, would be to finally put a price on carbon pollution. But this government has clearly signaled it is waiting for the Americans to write that policy for us.

The throne speech praised the government's 2009 stimulus spending for insulating Canadians from the pain of the global economic crisis "without unduly burdening future generations" - yet Prime Minister Harper's refusal to take strong and decisive action to prevent the irreversible impacts of climate change places the financial and ecological burden of those impacts squarely on the shoulders of future generations.

The good news is, we can only improve from here.

imarion — Nov 24, 2010 - 03:35 AM MT

Minister Prentice's tough talk on the oilsands from a few weeks ago rings hollow in a budget that includes no resources for improved environmental management in the oilsands. Oilsands development is not mentioned a single time in the entire 451-page budget.

In addition to doing next to nothing to address climate change at home, this budget fails to live up to the government’s international commitments, which include providing our fair share of climate change financing for developing countries and phasing out fossil fuel subsidies.

Milan — Mar 05, 2010 - 12:31 PM MT

The policy solution for avoiding catastrophic climate change is pretty simple: we must leave most remaining coal and unconventional oil and gas underground:

Carbon pricing is one way to encourage that, but ultimately our success or failure in curbing the cumulative emissions that cause climate change will depend on what proportion of these fuels we burn.

Milan — Mar 05, 2010 - 12:33 PM MT

Why bury coal? (along with unconventional oil and gas)

Roger Gagne — Mar 04, 2010 - 10:53 PM MT

It does look pretty bleak, doesn't it, Tim? But here in Alberta, the belly of the beast, home of the oilsands, Canada's greatest reliance on coal power, and the constituents of Mr. Harper as well as his Environment Minister Jim Prentice, there is a huge amount of readiness percolating just below the surface.

WADE Canada, the national chapter of the World Alliance for Decentralized Energy, has a Calgary office and held a very well attended roundtable in December, on clean and green energy options for the province. An Ipsos Reid survey last March found 78% of Albertans polled would rather see subsidies for renewables rather than oil and gas. Your own Greening the Grid study released last January has prompted a huge amount of discussion on leaving our coal in the ground, in favor of renewables, efficiency and cogeneration.

And last but not but least, we've seen 9 municipalities, ranging from the MD of Northern Lights to the Cities of Red Deer and Edmonton, writing letters to the Premier's Office asking for a task force to take a serious look at our renewable power potential and the best policies to accelerate it in Alberta. I know of eight other Cities and Towns with supportive Mayors who have said they'll present the initiative before their own Councils for consideration.

If the logjam breaks here, what an impact it could have on the federal scene!

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